Indian mobile phone company Spice Telecom said today that it will sell 20 percent of its equity to raise about US$300 million through an initial public offering by the end of the year.

Dilip Modi, chief of the firm, said the initial public offering (IPO) would be followed by a another round to raise RM350 million over the next two years "depending on government clearance to operate services in new states."

The company provides mobile phone service in northern Punjab and southern Karnataka states and is looking to invest more than two billion dollars to expand its operations throughout India, Modi said in a statement.

"This will be raised through debt, equity and promoter funding," he said.

Telekom Malaysia currently holds 49 percent of Spice and MCorp Global, the Indian partner, holds 51 percent.

The percentage of equity each company would sell in the IPO was not mentioned in the statement.